Franklin County gets ready to start bed tax at 5%

December 6, 2012

MALONE - A committee that has been haggling over a proposal to add a bed tax in Franklin County finalized their plan Tuesday and is set to present it to the county board today.

The proposal would establish a 5 percent sales tax on any hotel, motel, bed and breakfast, cottage, condominium or vacation rental stay less than 30 days.

Ernest Hohmeyer, owner and operator of the Lake Clear Lodge, said he thinks it's important for the county to get lodging owners on board with the tax. He said it's important to sell the idea as an investment in county tourism marketing efforts, rather than another tax and more paperwork for small business owners.

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Members of Franklin County’s bed tax committee work out details of their proposal Tuesday in the county offices in Malone.(Enterprise photo — Jessica Collier)

The percent to be charged and for what length of a stay were all up for discussion at the committee's two-hour Tuesday meeting, which was attended by Hohmeyer; Don Dew Jr., who runs the Timber Lodge hotel in Tupper Lake; county Department of Social Services Commissioner Lesley Lyon, who runs Sunday Pond Bed and Breakfast in Lake Clear; Chris LaBarge, the developer responsible for the new Holiday Inn Express in Malone; Bruce Monette, who is also involved in the Holiday Inn and runs Titus Mountain Ski Area; Neil Seymour, who retired as the county tourism director last year; Fawn Tatro, who took over as head of the tourism department, which was in part combined with the county Industrial Development Agency during budget cuts; plus several legislators and other county officials.

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Percentage

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Some committee members were in favor of a 4 percent tax rather than 5 percent. Hohmeyer said people like his wife who aren't in favor of the tax would be likelier to get on board if it were lower than 5 percent. He said he has gotten a lot of pushback in the Saranac Lake area for talking about a 5 percent tax, since Essex County's bed tax is 3 percent.

Essex County is now contemplating raising its bed tax to 5 percent, which would make that point moot, though, Hohmeyer noted.

Legislator Tim Burpoe, D-Saranac Lake, said he doesn't believe that people would decide to stay on the Essex County side of Saranac Lake rather than the Franklin County side solely because of a 2-percentage-point difference in the taxes. Hohmeyer said he doesn't believe that will happen either, but he said that there is a perception that it will among lodging owners.

Several committee members said they don't want to be in Essex County's position and have to revisit the law in a few years to increase the tax.

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What's included

Committee members also argued over whether to include bungalows, cabins and other vacation rentals in the tax, or whether it should just be hotels, motels and bed and breakfasts.

There will be issues with the enforcement of including the other types of lodging, since there are plenty of places in the area where family camps are rented out for a few weeks or weekends a year to help pay the taxes on them, committee members said. Those places largely fly under the tax radar already.

But the committee plans to rely largely on peer pressure for enforcement of the tax, which is why Hohmeyer is convinced lodging owners need to get on board with the idea of it as an investment in marketing.

In the end, Monette was the only committee member not in favor of adding vacation rentals to the proposed law.

To avoid problems with people who rent rooms or houses for residential purposes rather than tourism purposes, the committee decided to add a 29-day limit to stays that will be eligible to pay bed tax.

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Next steps

Committee members were on the agenda to present their plan to the county Board of Legislators at 10 a.m. today. Legislators will consider the idea and figure out where to go from here. The tax would need to be approved by county then the state Legislature if it is to be implemented.

In the meantime, committee members are advising that a Tourism Advisory Committee be set up right away to start getting familiar with the tourism interests of the county. The law sets out who will be represented on the TAC, and it stipulates that at least two of the members have to be from the southern end of the county.

If the bed tax is implemented, the TAC would come up with a plan to spend the money, and that plan would have to be approved by the county board.